posted on Jan, 21 2008 @ 11:00 PM
Credit abuse is a major reason we are in this situation. The banks are not all to blame....I'll use this example of my uncle because it fits what I
think many Americans do, not all. My uncle can not get credit at all anymore...why you ask? Because he literally has a $1 million dollars worth of
debt, probably more, but I know a $1 mil for sure....now, my grandmother decided, hey, it'll be a good idea to let him use my card. Instead he
charged it up twice, putting everything on it from Taco Bell, yes Taco Bell, to groceries and lots of fast food restaurants.
Heres the problem, if he doesn't pays it back, it's ok because its not his card, my grandma had to pay, which she did...hope she learned her lesson
but thats a different story. Anyways, to get on with it, I think many people do what he does. Case in point, all these foreclosures. I know my
uncles house is not worth now what he paid for it, so if the mortgage company forecloses on him, what do they gain? Nothing, they take a loss because
they can't get what it was worth.
A lot of people think credit is cash, but it's not and those finance charges will keep you paying it off forever. 18% thats ridiculous, and, thats
not the bad part, it can go as high as 31%. I'm looking at my cards now and that's basically what they say give or take a few percentage points.
So people go out and spend, spend, spend and they can't pay, a major reason the country is in this mess. Now, the lenders are to blame too, they did
give out quite a bit of bad loans, which is an understatement. I know it was easier to get a house than an appartment before this crisis hit. The
thing is, the Fed and now Bush are going to add another bandaid or crutch to it and things will get better for a while, but it's not really fixed.
I'm only 23 so I'm not much older than you DigitalGrl, so I know how it is to be young and worry about credit ratings, the value of the dollar, and
things of that nature. My cards are always paid off, and if I don't have the money, I don't use the card to get something, it's just not worth the
risk. I know some people will pay the minimum, but that will come back to get you. Right now, if I had the cash, I could get a house in my area for
probably less than 100K and I'm talking 3-4 bedrooms and something that will actually resemble a lawn, but this is Texas so prices are cheaper.
If you have the cash, now is a great time to be buying into the market. Most people will tell yo otherwise because they're scared, but, there are a
lot of "sales" right now of good companies that aren't even related to the credit crisis that are getting hurt. My investments as of today look
like crap; my stock return is -27% and my overall return is -18%, but, I'm not selling, and I'm not too worried, even if it is pissing me off as I
watch my good investments bleed. If I had the money to be buying, I guarantee you I would be.